Thursday, March 27, 2014

The
Halo Report, released today, finds
angel group activity rising with more high-valuation deals closed in 2013 than
the previous year. While median round sizes held steady at $600K per deal, they
were at a three year high when angels co-invested with non-angels. The share of angel investment in Internet, healthcare
and mobile startups continued to increase. Golden Seeds, Tech Coast Angels, and
Houston Angel Network, which is new to the list, were the three most active
angel groups in 2013.

“The
angel investing market is showing early signs of warming up, with co-investment
round sizes and valuations trending upward to three year highs,” said Rob
Wiltbank, Vice Chairman of Research, Angel Resource Institute. “With a
continued progression toward more even distribution of investments nationally,
entrepreneurs throughout the country are likely to find it easier to access
angel investors for critical early stage funding.”

The
largest share of angel deals (19%), with the greatest amount of investment
(20%), continues to occur in California, yet overall deals are becoming more
evenly distributed across the rest of the nation. The dollars invested,
however, remain more concentrated.In
2013, 67% of angel group dollars were invested in the top five out of ten
regions: California, New England, Great Lakes, Mid-Atlantic and the
Southeast.The same five regions
completed 63% of the deals.

Halo
Report 2013 Highlights:

Round
Sizes

Median
angel round sizes remained steady over a three year period and were $600K for
2013. When angel groups co-invest with other types of investors, the median
round size reached $1.7M, which was a three-year high, but fell in Q4 following
an upward trend earlier in the year.

Valuations

The
most consistent finding in the report is median pre-money valuations in early-stage
companies, which remain steady at $2.5M year over year. However, 2013 saw more
high-valuation deals close than 2012, despite the consistent median.

Most
Active Angel Groups

The
ten most active US angel groups were, in order:

Golden
Seeds

Tech
Coast Angels

Houston
Angel Network

Central
Texas Angel Network

Sand
Hill Angels

Launchpad
Venture Group

New
York Angels

Desert
Angels

Investor
Circle

Alliance
of Angels

Geography

Year
over year, only New York and the Mid-Atlantic region gained a larger share of
both deals and dollars in 2013. By the same measure, New England and the
Northwest produced a smaller share of deals and invested dollars than they had
the prior year. California and the Great Lakes led in share of deals in 2013, while
California and New England led in share of dollars invested.

Sectors

Together,
Internet, healthcare and mobile companies comprised an even higher percentage
of angel group deals (74%) and angel group dollars (79%), a significant increase
from the prior year. Internet companies saw the largest increase over other
sectors in share of deals and dollars in 2013.

The
Halo Report, introduced today to the 620 attendees at the ACAAngelSummit, includes aggregate analysis of investment activity by angels and
angel groups and highlights trends in round sizes, location and industry
preferences. The data is collected directly by the Angel Resource Institute (ARI)
and aggregated with public data using CB
Insights innovative data analyses. The 2013 Halo Report data is based on 884
deals totaling $1.1 billion in total rounds including co-investors.The transaction details are available in the CB Insights subscription database
for users to review and analyze themselves.Academics may also access some of the data through ARI.

The
Angel Resource Institute (ARI) is a charitable organization devoted to
education, mentoring and research in the field of angel investing, a growing
driver of our entrepreneurial economy. ARI was founded by the Ewing Marion
Kauffman Foundation. The programs of ARI include educational workshops and
seminars, research projects and reports, and information about angel investing
for the general public. ARI is affiliated with the Angel Capital Association,
the professional association of angel groups in North America. More information
is available at www.angelresourceinstitute.org.

Silicon
Valley Bank is the premier bank for technology, life science, cleantech, venture
capital, private equity and premium wine businesses. SVB provides industry
knowledge and connections, financing, treasury management, corporate investment
and international banking services to its clients worldwide through 28 US
offices and six international operations.(Nasdaq: SIVB) www.svb.com.

Silicon
Valley Bank is the California bank subsidiary and the commercial banking
operation of SVB Financial Group. Banking services are provided by Silicon
Valley Bank, a member of the FDIC and the Federal Reserve System. SVB Financial
Group is also a member of the Federal Reserve System.

CB
Insights is a National Science Foundation-backed
data-as-a-service firm that collects information on private companies and their
investors and acquirers. CB Insights data and technology is used by firms
to make better marketing, procurement, lending, acquisition and equity
investment decisions and to gather data-driven market and competitive
intelligence. The firm's data is regularly cited by leading media
publications including the New York Times, Forbes, Bloomberg BusinessWeek and Fast
Company among others. For more information, visit http://www.cbinsights.com.

Monday, March 3, 2014

Dramatic changes in angel investing
mean both threats and opportunities for the angel investment community and the
tens of thousands of entrepreneurs they support, according to the Angel Capital
Association (ACA), the world's leading professional
association for angel investors. The global angel investing community will
debate and assess this new environment at the 2014 ACA Summit, "Angel Impact:
Entrepreneurial and Economic Success,"March 26-28, 2014, in
Washington, D.C.

U.S. angel investors – individuals
who support startup companies with passion, experience and funding - in 2012 invested nearly $23 billion in
about 67,000 ventures, according to estimates by the Center for Venture
Research at the University of New Hampshire. Their impact on the economy is
huge, as the kinds of innovative startups angels invest in create all of the
net new jobs in the country, according to reports by the Census
Bureau and Kauffman Foundation.

"This is the place to be
for both experienced and (especially) new angels who want to share great ideas,
to learn unique investment practices from each other, and don't want to be left
unaware of how the seed stage investment landscape is changing -
particularly from a regulatory perspective,” said David Verrill, ACA’s
chairman. "We are hosting this meeting in Washington, D.C. for a
reason - the Securities and Exchange Commission is not only assessing the
underlying definition of who can be an accredited investor, but is also
reviewing significant rules around the JOBS Act involving general solicitation
and online crowdfunding platforms. Now more than ever is the time to join with
angel colleagues to learn about, to shape, and to nurture this
powerful economic engine."

This ACA Summit is the world’s
largest annual gathering of accredited angel investors. More than 700 angel
investors, including those among the most active, sophisticated and successful
in the world, will share expert advice and ideas. The Innovation Showcase, a
related event at the Summit, will show angels in action when dozens of promising
startups will receive invaluable advice and feedback from angels.

Discussions will include:

·
New and proposed federal rule changes, including a potential change to the
definition of an "accredited investor," which could dramatically
reduce capital available to startups and eliminate as many as 60 percent of the
current accredited investor population, dramatically affecting the economy and
job creation.

·
Congressional leaders, including Sen. Chris Murphy (D-Connecticut), will
discuss how they support angel investing and its vital role in innovation and
the American economy.

·
Insight into tactics angels deploy to identify the best investment
opportunities in top industries including life sciences and medical devices,
information technology and internet, cleantech and cyber security.

·
2013 angel group deal trends, collected from more than 200 angel groups, will
be shared by Rob Wiltbank, VP of research at the Angel Resource Institute
(ARI), with the live release of the 2013 Halo Report, by ARI
and Silicon Valley Bank, with data powered by CB Insights.

·
Compelling stories, including from Blackboard co-founder Michael Chasen, who
will recount how he took his learning management system company from angel
backing to IPO.

·
New accredited online platforms are disrupting the angel investing market.
Leading platform companies including premier sponsor FundersClub
will lead the discussion.

·
Which are the most angel-friendly countries in the world -- and how is
angel investing helping spur their economies?

To attend the ACA 2014 Summit,
register here. Registration is open
to ACA members and accredited individual investors from around the world, as
well as accelerator and incubator leaders, university innovation professionals,
economic development leaders, and public policy makers.

Note: Your Editor, having been among the founders of the ACA, could not be more pleased with their activities.

AboutAngel Capital Association(ACA)

The Angel Capital Association is the leading
professional and trade association focused on fueling the success of accredited
angel investors and portfolio companies in high-growth, early-stage ventures.
ACA is the voice of the angel industry, providing comprehensive services in
support of members working in angel groups, through portals and individually.
ACA provides professional development, public policy advocacy and significant
benefits and resources to its membership of 220 angel groups and more than
12,000 individual accredited investors. www.angelcapitalassociation.org;
@ACAAngelCapital.

About Me

George McQuilken is a founding member of the eCoast Angels Network, a group of private investors backing early-stage companies.

McQuilken was founding CEO of four companies including RSA Security. As Editor of the IBM Systems Journal, he published many of the seminal papers on software management, measurement, security, and quality. He was a project leader at IBM’s Cambridge Scientific Center working on virtual machines and networking. He is a graduate of MIT and member of the IEEE and the ACM.